If I am getting conversions, does that mean that I can make money? (6)
If I am getting conversions, does that mean that I can make money?
Lets say that I have an offer that is converting at 5% but has a lowish payout around $3 ... That just means that I need to pay less than 15 cents a click to make a profit right?
But what if my clicks are 35 cents? Then is it just a matter of optimizing, or is this campaign loosing too much to be profitable?
Originally Posted by conduit
If its a campaign that has already been optimized, you are using proven creatives etc ... and its still like this, well then the offer most likely isnt gonna work for you.
But if it's just the first attempt at running a campaign, you have no idea about the vertical or what creatives to use, you didn't cut any under-performing placements ... and you see results like these, then yes, there is potential to optimize it into profit.
You can always come up with a better LP, lower the bid, improve targeting, get better banners ... small % change in every one of these steps will result in a big CVR improvement as they actually multiply
Hello Conduit!
How are you?
Getting conversions doesn’t always mean that you’re making money – it means you can make money!
For you to know when you’ll be profitable you should track your expenses/revenues thoroughly. You should also pay attention to your impressions in order to calculate your campaign’s eCPM. With this data you’ll be able to know the bid value you can pay before going to negative ground - the formula is revenue/(impressions/1000).
Let’s imagine you have a campaign with a bid of 0.2. In this scenario, your revenue is 5$ and your impressions 35000. The eCPM of that campaign will be 5$/(35000/1000)=0.143. By doing this, you’ll be losing money which means you’ll have to lower your bid to the level of breakeven/profit that is 0.143, in order to stop losing money.
Anyway, you should check your bid. Afterwards you should compare it to your eCPM. If the eCPM is higher than your bid, you can raise it until it reaches the value of the eCPM. However, if the eCPM is lower than your bid, you should lower it to the value of your eCPM.
Even so, it would be great to know if you’ve already optimized this campaign. Why? Due to the fact that the optimization will ultimately affect the eCPM value.
If you have any questions don’t hesitate and ask away!
Cheers!
When is the "right" time to adjust the bid to the eCPM? I mean, I read here and there that especially on pops it makes sense to try different bids when testing campaigns (low, medium, high). And that in most cases, bid higher than average (at first) in order to see the quality of the offer by showing your ads in the best (and most competitive/expensive) placements available.
Just to give you an example. I'm testing an app with a payout of $0.54. After spending $10 on Popads with the "highest effective bid" (according to Popads), I have:
Spent: $10
Conversions: 8
Revenue: $4.32
eCPM: $3.35
CPM: $32,78
I'm testing a competitive geo like US and only with 3G traffic. I will open to wi-fi and cut some landers. Since 1 of them was already breaking even within the first $10 spent.
But according to what was said in the previous post, when should I consider to lower the CPM according to my eCPM?
This eCPM bid approach is simply a calculation of what you can pay to breakeven, based on past data, nothing more. So if you bought $10 worth of traffic and you made $4.32, based on this approach you would lower the bid to a level that would give you the same amount of traffic for $4.32
But, its not so easy as it ignores a few factors - lower bid will most likely mean lower traffic quality, so the revenue will go down too, so in the next round you'd have to lower the bid again etc ... until you get zero impressions. You will also get lower volume and that's not something you want.
A better approach is to work on both sides - so play with the bids, but also try to improve your landing pages. And of course optimize the campaign - cut placements, LPs, offers etc ... ONLY when you are 100% sure that you have reached the max possible performance and no optimization can help, then you can try to bid below the eCPM value and see if it works.
Hello, dandyman,
It’s true that it’s preferable to start with a higher bid during a period of time that allows you to have solid data about that segment in order to start optimizations later on.
Let’s suppose you have a good amount of data available to analyse but you’re losing money with the current targeting you have. What to do? You need to make changes so you’ll have to perform optimizations to your campaign according to performance. Then, a few days later, you’ll check whether or not you’ve started to profit after making the said changes.
Here’s another important thing you should take into consideration: when every single parameter of your campaign (browser/devices/OS/etc) is too expensive and there aren't any parameters showcasing a glimpse of profitability, you should start by lowering your bid to your eCPM and start building your campaign from that step onwards.
What I mean is this: you should put the bid to the eCPM in many different situations, such as in case you have optimized over and over again and see that nothing is profitable with the bid you have. Moreover, you could also do it in cases where you start collecting data and see there are no profitable parameters.
As @matuloo said, first start by optimizing, since you have data. Then, if nothing seems to become profitable, you should consider lowering your bid to the eCPM. From that point on, try finding the right targeting.
Besides these cases where you need to lower your bid to the eCPM, there are also situations where your bid is lower than the eCPM. If you're paying your traffic with a SmartCPM bidding system, then you can put your bid a little bit above the eCPM. Why? Because you’ll be paying below that value most of the times.
Wanna ask more questions? Let me know!
Cheers!
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